Re-Strike
Deferred Purchase Agreements
Brochure
Series 1 – Risk Stabilised SPI 200 Index Future Strategy
Series 2 – Risk Stabilised Aquantum Pegasus EL1 Strategy
Capital Protection Provider
Issuer: RBS Group (Australia) Pty Limited (ABN 78 000 862 797, AFSL 247013) Guarantor of the Issuer: The Royal Bank of Scotland N.V. (ABN 84 079 478 612, AFSL 238266)
2
Re-Strike Deferred Purchase Agreements
6½ and 7 year deferred purchase agreements
linked to the performance of the SFE SPI 200™
futures contract1 or the performance of the
Aquantum Pegasus EL1 Strategy Index.
Important
This brochure should be read
in conjunction with the Product
Disclosure Statement (PDS) dated
3 May 2010 and consider it before
making any investment decision.
Investors need to obtain their own
financial, legal and taxation advice
before making any investment
decision. A copy of the PDS can be
found at
www.rbs.com.au/structuredproducts
or be obtained by calling 1800 450 005.
Capitalised terms used in this
brochure have the meaning given
to them in the PDS.
What are the Re-Strike Deferred Purchase Agreements?
The Re-Strike Deferred Purchase Agreements (“Units” or “ReStrikes”) are designed to offer
Investors exposure to the performance of a Reference Index – either the Risk Stabilised SPI
200 Index Futures Strategy for Series 1 or the Risk Stabilised Aquantum Pegasus EL1 Strategy
for Series 2 (or both should an Investor choose to invest in Series 1 and 2). The Investment
Term is 7 years for Series 1 and 6½ years for Series 2. The exposure to either of these
indices (the “Reference Index”) is variable because its volatility affects the level of exposure
the Reference Index provides (via the “Participation Rate”). In general, the lower the volatility,
the higher the Participation Rate (and hence the higher the exposure to the Reference Index)
and vice versa. At Maturity, investors receive a Delivery Parcel containing ordinary shares in
five ASX listed companies. The Units provide:
• 100% capital protection if the investment is held to Maturity;
• it can never be cash-locked, and there is no maximum limit or “cap” on the upside;
• Fixed Coupons of 2.86% for Series 1 and 3.08% for Series 2 (compulsorily reinvested);
• Contingent coupons of 40% of all returns of the Reference Index Value above the first 5%
of returns (subject to a high water mark);
• 100% borrowing available.
Enhanced exposure to the market
Investors can participate anywhere between 0% and 150% for Series 1 and 0% to 145%
for Series 2 in any upside growth of the Reference Index depending on the volatility of the
Reference Index. Investors’ initial outlay is 80% of the Issue Price of $1.002. The Fixed Coupons
are used to pay the outstanding Issue Price. There is a Minimum Final Value of $1.00.
The Participation Rate
The variable Participation Rate is designed to manage market risk associated with the
performance of the Reference Index. It operates by varying the exposure that Re-Strikes
have to the Reference Index depending on its volatility. The higher the Volatility the lower
the Participation Rate – possibly as low as zero in which case no exposure to the relevant
Reference Index would be provided.
Reducing volatility
Re-Strikes use an averaging technique which seeks to reduce the effect of volatility of
the Reference Index by taking five observations during the final twelve (12) months of the
Investment Term to calculate the Final Value of Units. As averaging occurs over the final twelve
months of the Investment Term via the undertaking of five observations, its effect is expected
to decrease the impact of volatility on the Final Value of your investment.
1
FE SPI 200 is a trademark of Sydney Futures
S
Exchange Limited, a member of the ASX Group,
operating under the brand Australian Securities
Exchange. The Re-Strike DPA which provides
exposure over the SFE SPI 200™ futures contract are
not sponsored, endorsed, sold or promoted by SFE or
ASX, and neither SFE nor ASX make any representation
regarding the suitability of trading in such product(s).
Investors are required to pay the remaining 20% of the
Issue Price (i.e., $0.20) during the Investment Term of
the Units. Refer to the PDS for more information.
2
Acquire delivery assets
At Maturity, the Issuer will deliver the Delivery Parcel to you, which comprise ordinary shares
in the following ASX listed companies:
• BHP Billiton Limited
• Commonwealth Bank of Australia
• Wesfarmers Limited
• Telstra Corporation Limited
• Woolworths Limited
Series 1 & 2
Investment with No Currency Risk
Investors have the ability to take a positive view on the market. All returns are in Australian
Dollar so the investor does not take any currency risk.
Who might consider investing in Re-Strikes?
You should seek professional advice which considers your individual objectives, financial
situation and needs before making any investment decision.
Re-Strikes have been designed for investors who:
• are seeking a leveraged investment to the Reference Index;
• are seeking the potential for an income distribution during the Investment Term (even if all
or part of the distribution is reinvested);
• after Maturity, would like to receive a diversified exposure to a basket of ASX listed shares
in leading Australian companies;
• understand and can tolerate the risk associated with leverage and how it can impact
an investment in the Units both in positive and negative market conditions – that is, by
enhancing potential gains but also magnifying potential losses;
• require capital protection (only available at Maturity).
What are the key risks?
An investment in the Units would not be a suitable investment for Investors who:
• believe the Reference Index will be subject to consistently high levels of volatility over the
Investment Term or wish to participate in the performance of the Reference Index during
periods of high volatility;
• do not have a positive view of the Reference Index over the Investment Term and in
particular believe that the Reference Index will not increase between the Commencement
Date and the Maturity Date;
• are seeking an unleveraged investment;
• are unwilling to commit for the full Investment Term of the Units – that is, from the
Commencement Date to the Maturity Date.
This list is not comprehensive and does not take into account a potential Investor’s
personal needs and circumstances. Investors should read the Re-Strike Deferred
Purchase Agreements Product Disclosure Statement Dated 3 May 2010, in particular
Section 7 “Risks”, when considering the suitability of this investment product.
3
Re-Strike Deferred Purchase Agreements
Historical performance1
The data shown in the graph and the average annual rate of return published under the
graphs are based on historic levels of:
For Series 1, the S&P/ASX 200 Index, MSCI World Index and the simulated historic levels of the
Risk Stabilised SPI 200 Index Future Strategy;
For Series 2, MSCI World Index and the simulated historic levels of the Aquantum Pegasus
EL1 Excess Return Index and Risk Stabilised Aquantum Pegasus EL1 Strategy (net of fees
and costs).
The table under each graph shows the average annual rate of return based on simple
averaging of the respective indices.
Series 1: S&P/ASX100
vs Risk Stabilised SPI 200 Index Future Strategy vs MSCI World
S&P/ASX 200 vs Risk Stabilised SPI 200 Index Future Strategy vs MSCI World
Performance Graphs
Perform ance Graphs
Series 1 Reference Index
S&P/ASX 200
MSCI
250
200
150
100
06-Dec-09
06-Jun-09
06-Dec-08
06-Jun-08
06-Dec-07
06-Jun-07
06-Dec-06
06-Jun-06
06-Dec-05
06-Jun-05
06-Dec-04
06-Jun-04
06-Dec-03
06-Jun-03
06-Dec-02
06-Jun-02
06-Dec-01
06-Jun-01
0
06-Dec-00
50
06-Jun-00
4
Annualised Rate of Return
For the last
5 years (pa)
10 years (pa)
2
Risk Stabilised SPI 200
Index Futures Strategy
(Series 1)
Performance of
S&P/ASX200 Index
Performance of
MSCI World Index
4.97%
2.52%
-0.36%
5.36%
5.17%
-1.72%
The graphs use data ending on each Business Day from 6 June 2000 to 3 March 2010 for Series 1 and 6 October
1
1997 to 3 March 2010 for Series 2.
2
The data available for the Reference and Underlying Indices is only from 6 June 2000 to 3 March 2010, which is
9 years and 9 months.
Series 1 & 2
Series 2: Aquantum
PegasusIndex
Index
Risk
Stabilised
Aquantum
Pegasus
EL1 Strategy
Aquantum Pegasus
vs vs
Risk
Stabilised
Aquantum
Pegasus
EL1 Strategy
vs MSCI World Performance vs
Graphs
MSCI World Performance Graphs
Series 2 Reference Index
Aquantum Pegasus
MSCI
600
500
400
300
200
100
12-Sep-09
12-Sep-08
12-Sep-07
12-Sep-06
12-Sep-05
12-Sep-04
12-Sep-03
12-Sep-02
12-Sep-01
12-Sep-00
12-Sep-99
12-Sep-98
12-Sep-97
0
Annualised Rate of Return
For the last
Risk Stabilised Aquantum
Pegasus EL1 Strategy
(Series 2)
Performance of
Aquantum Pegasus
EL Excess Return Index
Performance of
MSCI World Index
5 years (pa)
18.68%
13.43%
-0.36%%
10 years (pa)
34.68%
23.40%
-1.64%
It is important that Investors note that past performance and simulated performance is
not a reliable indicator of future performance and returns are not guaranteed.
Historical performance and simulations
The performance of each Reference Index in the above graphs is simulated past performance based on the
application of the calculations and formulae as they apply to the Reference Index in this PDS with the input of
historical data dated over the periods shown. The returns shown are shown after the deduction of any fees and
costs applicable to the relevant Reference Index (including any applicable taxes) as disclosed in this PDS.
Returns are calculated with reference to the Participation Rates, volatility levels and, where applicable, interest
rates that applied on each observation dated during the period of performance shown. Investors should note
that these returns are those that applied to the Reference Index and is NOT the simulated Final Value of
Units. The graphs show the Reference Index Value that is used in calculating Coupons or the Final Value.
In calculating the historical performance and simulations for the Reference Index, the Issuer has assumed that
there were no Adjustment Events or Market Disruption Events which would have resulted in the Early Maturity of
the Units (although the Issuer is not aware of any events which would have resulted in the Early Maturity of the
Units for the period which the graphs cover). Where there was a Market Disruption Event or other event which
prevented the publishing of the level of the Reference Index in the relevant period, the Issuer has used the level
which applied on the previous day.
5
6
Re-Strike Deferred Purchase Agreements
Key information
Key dates
Issue Opening Date
3 May 2010
Issue Closing Date
23 June 2010
Application Payment Date 30 June 2010
Commencement Date
10 July 2010, or as soon as reasonably practicable thereafter
as determined by the Issuer.
Maturity Date
Series 1: 10 July 2017
Series 2: 10 January 2017
Reference Index
Series 1: Risk Stabilised
SPI 200 Index Future
Strategy
Series 2: Risk Stabilised
Aquantum Pegasus EL1
Strategy
Issue Price
Series 1 & 2: A$1.00
Key terms
Investors are required to pay $0.80 per Unit by the Issue
Closing Date – the “Initial Instalment Payment”. The remaining
$0.20 is paid by the Investor over the Investment Term through
the re-investment of the Fixed Coupons.
Final Hurdle
Series 1: 14%,
Series 2: 6.5%
The Final Hurdle is deducted from the Final Value.
See Section 3.2 of the PDS for details.
Minimum Investment
Amount
20,000 Units or $16,000 and thereafter in multiples of $800
(i.e. 1,000 Units given the Initial Instalment Payment is $0.80
per Unit).
Fees
No fees are payable by the Investor.
RBS may pay annual rebates out of its own funds
to distributors.
Underlying Index costs are incorporated into the calculation
of The Underlying Index. Please refer to the PDS for
more information.
Contact information
For further information contact:
The Issuer
Telephone: 1800 450 005
Website: www.rbs.com.au/structuredproducts
Email: productsupport.au@rbs.com
Disclaimer
This brochure has been prepared by RBS Group (Australia) Pty Limited ABN 78 000 862 797 AFSL 247013 as the
Issuer of the Units (RBS or the Issuer). A product disclosure statement (PDS) for the Re-Strike DPA Series 1 & 2 Units
is available and can be obtained by contacting RBS on 1800 450 005 or by downloading a copy on www.rbs.com.au/
structuredproducts. You should read the PDS before making any investment decision.
The information provided in this brochure is general information only and does not purport to be all inclusive or
constitute any form of financial product advice. We recommend that you consult your financial adviser to determine
the suitability of the Re-Strike DPA Series 1 & 2 Units to your personal investment objectives, financial situation and
particular needs.
Although RBS attempts to provide accurate, complete and up-to-date information which has been obtained from
sources that are considered reliable, RBS makes no warranties or representations, express or implied, as to whether
information provided in this brochure is accurate, complete or up-to-date. RBS reserves the right to change the
information provided in this brochure, including the terms of this Disclaimer, at any time and without notice.
Any returns on indices or other assets as shown in this brochure are used only to demonstrate how the features of the
product work. They are not a forecast, do not indicate past performance and are not a guarantee that similar returns
would be achieve in the future.
RBS, or the relevant owner, retains all rights (including copyrights, trademarks, patents, as well as any other intellectual
property right) in relation to all information provided in this brochure (including all texts, graphics and logos). You may
not copy, download, publish, distribute or reproduce any of the information contained in this brochure in any form
without the prior written consent of RBS or the appropriate consent of the owner. However, you may download this
brochure for your own personal use.
Neither RBS, its related bodies corporate nor its affiliates nor any of its agents or subcontractors shall be liable for any
direct, indirect, special, incidental, consequential, punitive, or exemplary damages, including lost profits (even if RBS
is advised of the possibility thereof) arising in any way from, including but not limited to:
(i) the information provided in this brochure;
(ii) the modification or misuse of information provided in this brochure;
(iii) claims of third parties in connection with the use of this brochure.
The exclusion of liability is also made for the benefit of directors and employees of RBS, its related bodies corporate
and affiliates.
No personal advice
None of the Issuer, its related bodies corporate and their directors, officers or employees makes any recommendation as
to the suitability of the Units for any Investor or makes any representation or gives any assurance as to the performance
of the Units or any particular rate of overall return. This brochure does not contain any personal investment advice.
No endorsement by issuers of the Delivery Assets
Although a basket of ASX-listed securities (the Delivery Assets) are deliverable on maturity of the Units, this should
not be construed as an express or implied endorsement of the Delivery Assets by the Issuer or the Units or any
endorsement of the Units by the issuer of the Delivery Assets. None of the issuers of the Delivery Assets has authorised,
been involved in the preparation of, or caused the issue of, this brochure.
No endorsement by Index Sponsors
Various indices are referred to in this brochure. This should not be construed as an express or implied endorsement of
the Units by the Index Sponsors or any endorsement of the indices by the Issuer. None of the Index Sponsors or funds
have authorised, been involved in the preparation of, or caused the issue of, this brochure. The Index Sponsors do not
take any responsibility for any part of this brochure or issue of Units.
Nature of the Units
The Units are securities for the purposes of Chapter 7 of the Corporations Act 2001 (Cth). The Units are not units in a
managed investment scheme.
Series 1 & 2
7
Disclaimer: This brochure is for information purposes only and while the information contained within is believed to be reliable, no representation, warranty, or assurance of
any kind, express or implied is made as to the accuracy or completeness of the information. RBS Group (Australia) Pty Limited (ABN 78 000 862 797, AFSL: 247013) (“RBS”)
accepts no obligation to any recipient to update or correct any information contained in this brochure. This brochure does not purport to be all inclusive or constitute an offer,
recommendation or invitation to purchase securities and is not to be taken as a substitute for the recipient exercising their own judgement and seeking their own advice. In
preparing this brochure, RBS has not taken into account the recipients individual objectives, financial situation or particular needs. Before the recipient makes an investment
decision they should consider the appropriateness of any advice to their particular investment needs, objectives and financial circumstances. RBS, to the extent permitted by
law, accepts no liability or responsibility whatsoever for any loss arising from any use of this brochure or its contents. This brochure is the proprietary information of RBS, and may
not be reproduced, distributed or published for any purpose without the prior written consent of RBS.
The products mentioned in this report are issued by RBS. The broker to the issuer is RBS Equities (Australia) Limited (ABN 84 002 768 701, AFSL: 240530). The Product Disclosure
Statement (“PDS”) relating to these warrants is available upon request from RBS (1800 450 005) or on our website www.rbs.com.au/warrants.
RBS Group (Australia) Pty Limited is not an Authorised Deposit-Taking Institution and these products do not form deposits or other liabilities of The Royal Bank of Scotland N.V. or The
Royal Bank of Scotland plc. The Royal Bank of Scotland plc does not guarantee the obligations of RBS Group (Australia) Pty Limited.
© 2009 RBS Group (Australia) Pty Limited.
GMR0310100
To find out more about the Re-Strike Deferred Purchase Agreements Series 1 & 2,
Log on to www.rbs.com.au/structuredproducts or call 1800 450 005
Issuer: RBS Group (Australia) Pty Limited (ABN 78 000 862 797, AFSL 247013) Guarantor of the Issuer: The Royal Bank of Scotland N.V. (ABN 84 079 478 612, AFSL 238266)